Bygone budgets: March 1977

The March 1977 budget did not fix tax rates and allowances.These became a political football and were subsequently changed. Two Labour backbenchers, Jeff Rooker and Audrey Wise, successfully amended the finance bill to index-link major tax allowances each year unless parliament explicitly voted not to do so. This became known as the Rooker-Wise amendment. Opposition leader Margaret Thatcher said it was not a revival budget for Britain but a survival budget for the Labour party.

Income tax Basic rate cut by 2% to 33%, on condition that trade unions agreed to a third year of wage restraint.

National Insurance 2% surcharge no longer applies to charities.

Privatisation Government confirms plans to raise £500m by selling off a slice of its 68% stake in BP to leave it with a majority shareholding.

Temporary employment subsidy This system of grants to employers who were in danger of declaring redundancies was due to end, but is extended for one year.

Duties 20 cigarettes up by 4p, pipe tobacco duty.

October 1977 Mini-BudgetChancellor: Denis HealeyGovernment: Labour After continued controversy over the tax rates and allowances proposed in the March 1977 budget, the chancellor, Denis Healey, called a mini-budget in the autumn. He spoke for a mere 21 minutes to announce changes in tax allowances. He called it "a budget of reward", repaying recent sacrifices that tax-payers had made. The chancellor also announced spending of £400m on public works. Conservative shadow chancellor Geoffrey Howe had a different name for it: a "budget of repentance".

Personal income tax allowances Single person's tax allowance raised by £100 to £945, married couple's allowance raised by £160 to £1,455.

Exchange controls Exchange controls eased, allowing individuals up to £500 in foreign country, instead of £300 and the amount of sterling which could be taken abroad was increased from £25 to £100.

Capital transfer tax Thresholds, introduced in the wake of the 1974 budget, were increased.

Pensioners Tax-free Christmas bonus of £10.

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About this article

Bygone budgets: March 1977

This article was published on
the Guardian website
at 10.33 EST on Wednesday 3 March 1999.
It was last modified at 10.33 EST on Wednesday 14 February 2001.
It was first published at 10.33 EST on Wednesday 14 February 2001.